I select an image in the Organizer and open it in the PSE Editor. I edit the file. I save as.
The file name to be saved is not automatically apended with '-edited 1' as it would have been in previous versions of PSE, but appears as the original file name. If I try to save, I will get 'File already exists. Do you want to replace it?' which I don't, and so I manually change the filename. I can now save, and I check 'Include in Elements Organizer' and 'Save in version set with original'.
The thumbnail for this new file now appears in the Organizer. It is marked in the top right corner with a small icon indicating version set (I assume), but the original file is not visible. If I search for this original file by filename, it can't be found. If I right click on the visible thumbnail and open the context menu, the 'Version set' choice is greyed out. If I select the new thumbnail and choose Edit> Version Set all the sunsequent commands to do with Version Set are greyed out. The original file still exists in its folder on my computer. If I choose File> Get Photos & Videos> From Files & Folders and try and import the original file, this fails with the message: "skipped because already present in the catalog." which it isn't (or isn't visible anyway).
I believe you need to be in the Details view to see version sets. Press Cmd+D to get into the Details view of the Organizer, and your original photo should be present in the version set if you click on the right-facing arrow.